Major Hurdle in Consumer Lawsuit Against DIRECTV For Early Cancellation Penalties

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Los Angeles Superior Judge Emilie Elias issued a ruling certifying a California class action last Friday in a suit filed in September 2008 on behalf of DIRECTV customers who were charged a cancellation penalty when they cancelled service. The complaint alleges that DIRECTV applied its unlawful penalty provision to all of its customers, including, in some cases, customers who terminated because the satellite equipment stopped working or they were no longer able to receive service when they moved.

“This type of business practice is a direct violation of California’s consumer protection laws. The court’s ruling certifying the class is a step towards achieving justice for DIRECTV customers , ” said Attorney Ingrid M. Evans, The Evans Law Firm, SF.

A lawsuit for California DIRECTV customers represented by The Evans Law Firm, Consumer Watchdog, the Law Offices of Edie Mermelstein, Milstein Adelman and Sprenger +Lang by DIRECTV customers who were alleged to have been illegally charged “early cancellation penalties” – fees of up to $480 – has been granted “class action” status by a California court, potentially leading to millions of dollars in refunds. DIRECTV is the largest satellite TV provider in the U.S. with over 16 million customers, and its principal place of business is located in El Segundo, California.

Los Angeles Superior Judge Emilie Elias issued the ruling last Friday in a suit filed in September 2008 on behalf of DIRECTV customers who were charged a cancellation penalty when they cancelled service. The complaint alleges that DIRECTV applied its unlawful penalty provision to all of its customers, including, in some cases, customers who terminated because the satellite equipment stopped working or they were no longer able to receive service when they moved. The complaint also alleges that in other cases, DIRECTV would unilaterally extend a consumer’s "programming commitment" by a year or two if malfunctioning equipment needed to be replaced or the customer decided to upgrade receivers and then charge the fee if the customer stopped service after that. In some cases, according to the suit, DIRECTV took the fees from their customers’ bank or credit card accounts without their permission.

The lawsuit alleges that the fees are illegal under California’s consumer protection laws. In addition to arguing that its cancellation penalties are legal, DIRECTV claimed that the company’s recent “settlement” with the Attorneys General of California and other states resolved the plaintiffs’ complaints. The court rejected that argument, specifically noting that the Attorney General settlement did not bar DIRECTV from applying the cancellation fee in the future. See Court's Order issued April 20, 2011, Los Angeles Superior Court Case No. BC398295 (attached to this release).

“We have alleged in the complaint that this type of business practice is a direct violation of California’s consumer protection laws. The court’s ruling certifying the class is a step towards achieving justice for DIRECTV customers that were charged an illegal penalty,” said Ingrid M. Evans of The Evans Law Firm, San Francisco, CA, one of the attorneys for the plaintiffs.

Another attorney for the plaintiffs, Pamela Pressley of Consumer Watchdog said, “DIRECTV’s cancellation penalties were designed to hold their customers hostage and keep them from switching to other companies even when they could no longer receive the service because of faulty equipment or because they moved. Now, after nearly three years of delaying tactics by DIRECTV, its California customers will finally have their day in court to seek refunds and to stop DIRECTV’s improper cancellation penalties.”

Certifying the case as a “class action” means that all California consumers who were victimized by DIRECTV’s alleged unlawful actions and do not choose to opt out of the action will be represented in the litigation.

Ingrid M. Evans, of the Evans Law Firm (http://www.evanslaw.com), San Francisco, CA and Sprenger + Lang, PLLC, Washington DC represent Plaintiff Amy Imburgia, a California resident who in 2008 filed the first California State court class action lawsuit under California’s Unfair Competition Law and Consumer Legal Remedies Act. The Lawsuit was filed in Los Angeles Superior Court Case No. BC398295.

This action was later consolidated with a related action brought by Consumer Watchdog (http://www.consumerwatchdog.org), the Law Offices of Edie Mermelstein and Milstein Adelman, LLP and on behalf Long Beach resident Kathy Greiner. Similar suits were filed in federal courts throughout the country. They have since been consolidated in one federal court, the Central District of California, Southern Division, located in Santa Ana.

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